Statoil moves on $2.27 billion Snorre Expansion Project

Norway's Statoil is planning to start production from a US$2.27 (NOK19 billion) expansion project on its Snorre field in the Norwegian North Sea by 2021, tapping an additional 200 MMbo from the field and extending its life out to at least 2040.

The field, discovered in 1979, in 300-380m water depth, in the Tampen area, and producing since 1992, was originally thought to contain 750 MMbo recoverable reserves. To date, Snorre has produced 1.4 billion bo, with 46% recovery rate. With the Snorre Expansion Project, which will see 24 new wells drilled (12 production and 12 water aternating gas injection), from six new subsea templates, the recovery rate will increase to 51%, says Statoil.

The firm today submitted a plan for development and operation (PDO) for the Snorre Expansion Project - which it calls the largest improved oil recovery project on the Norwegian Continental Shelf - and announced contract awards for the subsea production system with TechnipFMC, fabrication and installation of the pipeline bundle system with Subsea 7, modification work on Snorre A with Aibel and a rig with Transocean.

Six new subsea templates will be installed, along with new pipelines and umilicals between the templates and the Snorre A facility, which will also be upgraded to take the extra production and supply the water and gas injection.

Subsea 7's engineering, procurement, construction and installation (EPCI) contract includes three pipeline bundles: West, East and North. Production of the pipeline bundles will be at Subsea 7's facilities at Wick, Scotland. Project management and engineering will start immediately at Subsea 7's offices in Stavanger, Norway and Aberdeen, Scotland. Offshore operations will take place in 2019 and 2020.

Aibel's contract is an engineering, procurement, construction, installation and commissioning (EPCIC) contract, which follows on from a front end engineering and design study Aibel conducted on Snorre. Modifications to Snorre A will include removal of excess weight and equipment. Initial activity offshore will start in January 2018.

Aibel's contract also comprises the installation of a new 650-ton support module for risers. This will be built at Aibel’s yard in Haugesund, Norway. The start of prefabrication is planned for January 2019, while the actual installation of the module is scheduled for Spring 2020.

TechnipFMC's contract is an engineering, procurement and construction (EPC) contract covering delivery of subsea production systems, including the six subsea templates.

In 2017, Statoil has now submitted four plans for development and operation in 2017, worth a total $10.75 billion in investment (NOK 90 billion): Njord and Bauge in the Norwegian Sea, Johan Castberg in the Barents Sea and now Snorre Expansion Project in the North Sea.

“In 2017, we have benefitted from a comprehensive improvement effort by Statoil and suppliers, and we have succeeded in realizing development plans for Njord, Bauge, Johan Castberg and now Snorre Expansion, leading to investments of NOK 90 billion on the Norwegian continental shelf (NCS) and important activity for the industry,” says Margareth Øvrum, executive vice president for Technology, Projects and Drilling.

“During the past years, Norwegian suppliers have demonstrated both a will and ability to change. Due to enhanced competitiveness, Norwegian industry plays a key role also in the Snorre Expansion project. We estimate that 80% of the investments will include companies in Norway. Competitiveness has a short shelf-life however, and it is vital that the improvement work continues with unabated strength,” says Øvrum.

Snorre is one of the fields with the largest remaining reserves in Statoil’s portfolio of oil producing fields on the Norwegian continental shelf, says the firm.